Countrywide Refinance

They say they will do a guarantee lock on our refinance which means if the loan averages 60 days or more our rate is guaranteed? My loan officer said he's going to call me tomorrow morning for verbal authorization to lock because he'll be out of the office for the rest of the day.  I just hope rates don't go up from now and tomorrow morning. Another sleepless night! I should trust the verbal authorization will lock us the rate? Is this the norm and then we will receive the paperwork shortly? 

We're looking at locking 4.875 % 0 points 15 yr >90% LTV HASP loan (was originally 80% LTV conforming loan no PMI when we purchased last year) Home prices are falling fast in CA! Credit scores over 800.  Have any of you handled HASP loans?  Should I expect anything different than a regular refi? Longer overturn time if HASP loans get the back burner?

I can live with that rate so I want to lock ASAP. 

Email your lock in authorization, AND ask your loan officer to email you the Lock Confirmation.

Louis

The turn times should be similar to a normal refinance. 

I received an email this morning from my loan officer saying that he's tied up with end of month closings and will try to call me this afternoon and that rates haven't lowered which I believe they have. Have you all seen reprices today? Is he blowing us off? I just want to get a great rate locked and worried if this gets postponed anymore we may lose our opportunity.

If he had enough time to email you, he had enough time to lock your loan.  I would request a call from his manager.

I completely agree with Kent and Louis. The rates are same as yesterday evening however the pricing has gone better. I believe you must be talking about the new DU refi Plus program launched by Fannie Mae. The turn around times is normal however it greatly depends from lender to lender though.

He can certainly lock the rate and should email you the confirmation for same.

Thanks guys for all of your input! I love receiving all the additional opinions. :)

Well my loan officer called me just now and we went over some numbers. We're going to do a loan of 250k which puts us at 86% LTV and he mentioned that anything over 80% will require an impount account with HASP.  Can you all confirm that to be true?

Anyways, I'm not going to dispute it. I don't want to sit on this any longer and gave him verbal authorization to lock and gave him my credit card number for the application fee. I did get some further good news that it seems we won't need any further appraisal which will save us some money and he goes by what the home values in the system versus a personal appraisal which happens to be higher than the 2 appraisals we have had done in both April & May.  He also said it looks like we won't have to provide further documentation and just "state" assets. He said with no appraisal and just "stating" assets he thinks this refinance will move along a lot quicker! I wish we could just go by the appraisal values that these banks have or even zillow.com is much higher than the actual appraisers that came out and used terrible comps on our home (busy streets, commercial areas) How can these comps vary so much? It seems like things would move along so much faster if we just used the comps that banks use for estimates but that would put all the appraisers out of jobs right? I guess we don't need any further unemployment problems however, our low appraisals have really made this refinance process a rocky one.

4.875 no points 15 yr loan and I locked! Not bad right?  I requested that he'd email me a good faith estimate and he said he would mail it to me early next week but he could also email me a copy as well.  Have a good weekend!

Okay--- what's HASP?

I know that a 15 yr DU Refi Plus at 86%- would require impounds but not mortgage insurance if not on original loan.  The rate of 4.875% 0 pts/origination---is good.

Sorry the names have changed on these plans and it is hard to keep up. I beleive HASP was the original term for (Home Affordability Stability Program) now often referred to Making Homes Affordable Program and I also believe that it is considered the DU Refi plus for loans up to 105% LTV.   I believe they are all one in the same but I may be wrong.

Thanks for confirming that it is a good rate and that impound accounts are required above 80 % LTV. 

I know when we got our original home loan last year we started with an Impound Account to lower our interest rate slightly and later canceled the impound account because we are good savers and can save our own money to pay those bills (Property tax  & Homeowner's Insurance) However, our loan officer said that now with this program they won't allow you to cancel the impound account until at least 22% equity and could require an appraisal. Sounds like the same stipulations to cancel PMI to me? I'm happy that we don't have PMI and will not be required to have it even now that we are at a higher LTV. 

Now you can start sleeping easier at night.  Congratulations.

Thanks Kent! I do feel relieved to have a rate locked now lets hope the rest goes smoothly.

In your experience how much does the bank/lender usually take out initially for the impound accounts? I've read anywhere from 2 to 4 months of property tax & homeowners insurance they take at the beginning?

I just want to have a better idea of what I'm looking at in total closing costs including the impound account. Would that be in the good faith estimate that I should see in the next week or so?

The impound account set up is based upon when your taxes and insurance are due.  Lenders are allowed to set up a 2 month cushion in addition. 

To get an estimate of the amount you will need to set up your account, folow these steps:

1. Find out what month your taxes and insurance are next paid and how many months are paid at that time. (in most states, taxes are due 2X per year, thus 6 months are due each time; insurance is usually a full year payment so 12 months would be due)
2. Add 2 months for each.
3. Subtract the number of months of payments that you will make between now and the month prior to when each account is paid.

So, if your taxes were due in Oct and you would need 6 months at that time and if your insurance was due in May and you would need 12 months at that time and let's say you are closing in July with your 1st payment in Sept:

1. 6months for taxes and 12 months for insurance
2. 6+2 = 8 months taxes     12+2 = 14 months for insurance
3. 8-1 = 7 (you don't count the Oct pmt)  14-8 = 6 (don't count the May pmt)

Thanks for the great explanation Kent!  I just locked at the end of June and my loan officer mentioned an average of 60 day refinances so we would most likely close at the end of August. I should pay just interest in August and our first Mortgage payment would be October 1st correct? We wouldn't have a Mortgage payment in September.  I remember that to be the case when we purchased the home last year. We closed at the end of May and in closing we paid the interest then paid nothing in June and July 1st was our first Mortgage payment.

Now If Property Tax is due twice a year on Nov 1st & Feb 1st (However not late nor penalized till Dec 10th & April 10th.

I figure we would need at least 7 months of property tax up front. 2 month cush + 5 months. Not sure if they would count our Nov 1st Mortgage payment towards the first property tax payment or just the October Mortgage would go towards the first payment.  

I was looking over our last GFE and I see closing cost would be over $2700 and that is excluding the Appraisal fee because we won't be needing one this time around nor paying points.  I remember my loan officer saying that our closing costs could be under 2000 now which I just don't see it. I am going by the GFE of our refinance application we did in February however the loan amount then was 280 k versus 250 k now however when it comes to third party fees, title fees, lender fees would they vary on a cheaper loan? I'm assuming they stay the same and the only amount that would vary in closing costs based on the loan amount would be if we were buying a point or am I wrong?

Christina G:

we would most likely close at the end of August. I should pay just interest in August and our first Mortgage payment would be October 1st correct?

That's right.

Christina G:

we would need at least 7 months of property tax up front. 2 month cush + 5 months

Right again.

Christina G:

when it comes to third party fees, title fees, lender fees would they vary on a cheaper loan? I'm assuming they stay the same and the only amount that would vary in closing costs based on the loan amount would be if we were buying a point or am I wrong?

Some of the fees are based on your loan amount, but they should not be significantly different.  You won't need an owner's title insurance policy, so that will save some money.  Finally, you could probably have gotten a lower rate with some additional closing costs and the last financing you had probably took advantage of this.

Thanks again Kent! You've been great about responding to my many questions. In your opinion, is it best to try to close at the end of the month as to avoid paying just interest on the month of closing? Is that why my loan officer said he's busy with end of month closings because most prefer to close at the end of a month?

How quickly should I expect the GFE? I'm just anxious to see my locked rate in writing. As for now it has all been verbal.  I won't bother him this week since he's dealing with end of the month closings and it's a holiday week.

You should be sent a GFE within 3 days of your application. 

On a refi, it really doesn't matter when you close (as long as it isn't an FHA loan) because you will pay interest on your old loan until it is paid off and interest on the new loan once it funds. 

Don't worry about bothering your originator.  Their job is to help you.  If they are not willing to help, they should not be rewarded with a paycheck.

We don't have an FHA loan. I guess the sooner we can close the better since we will be changing to a better rate, so no need to wait for an end of month. I will contact my Loan officer to confirm an estimate of time on the GFE. You're right I should be asking him these question, since he's getting paid for it . Thanks again for all of your help! I keep wondering if I'll be able to leave this site once my Refi closes. I really like this site!

Just curious but I still haven't received my GFE and I locked verbally on Friday 6/26.  If rates happen to take a decent drop this week and I haven't received a GFE (even though I do believe my refi is in process) could I ask the lower rate? What are often the charges to the customer for that?

Kent Mikkola:

Some of the fees are based on your loan amount, but they should not be significantly different.  You won't need an owner's title insurance policy, so that will save some money. 

Kent, I'm looking over my Refi GFE and noticed $100 for "Title Insurance Endorsement" Is that a fee you mentioned that we shouldn't have to pay? There is also a fee for Title Insurance $714

Actually here are the listed charges under Title Charges: (Let me know if this looks correct to you) I've heard a term around here called junk fees that can be disputed what fees are those? I also feel the need to pick my battles at this point, we do need the refi maybe more than my LO needs us as a customer! lol

Title Charges:

$550 Closing or Escrow fee

$100 Notary

$714 Title Insurance

$100 Title Insurance Endorsement

$200 Settlement Agent/Escrow (This is a new fee that wasn't listed on our previous GFE from a Refi we started in Feb 2009)

$50 Courier Express Mail (Still yet to receive my Fed Ex of my GFE that was prepared on 7/2)

(0 points / 0 origination fees on a 250 k loan)

It's me again!

I've been doing some reading and it seems that we could be eligible for a reissue/revamp rate on title insurance since our refinance is with the same lender.  That could be up to 55% discount. Now when is the time to bring this up to my LO, obviously before closing right? He has to make a request for the discount on our behalf with the title company correct?